Assume that capital and labor are complementary inputs. If the firm decreases the amount of capital it employs, this would

A. cause the firm to move down along the MP schedule for labor.
B. shift the firm?s MP schedule for labor to the left.
C. shift the firm?s MP schedule for labor to the right.
D. cause the firm to move up along its MP schedule for labor.


Answer: B

Economics

You might also like to view...

The saving rate in the United States fell to nearly zero in the early 2000s. One of the contributing factors to this development was the

a. decrease in consumer confidence in the late 1990s. b. declining real incomes of most American households. c. increased housing wealth. d. rising real interest rates in the United States.

Economics

Minimum-wage laws dictate the lowest wage that firms may pay workers

a. True b. False Indicate whether the statement is true or false

Economics

Susan is planning to invest in one of four stock portfolios, and her financial advisor has given her details regarding the risk associated with each portfolio. Which of the following portfolios would you expect to have the lowest average annual rate of return?

a. A portfolio with a standard deviation of 3%. b. A portfolio with a standard deviation of 6%. c. A portfolio with a standard deviation of 9%. d. A portfolio with a standard deviation of 12%.

Economics

A lump-sum tax (a tax that is treated as a fixed cost) is placed on a monopolist. How will that affect its output and pricing decisions?

Economics